Telford Homes Share Discussion Threads

[owenski] 06/6/2017 11:43

Strange reaction considering TEF isn't overvalued and has a proven management team and a good pipeline etc

[gbh2] 06/6/2017 11:28

SP suggests someone's not impressed with recent announcements and or future potential :(

[aimingupward2] 05/6/2017 22:05

Indeed you're right, easyfella, and thank you for drawing attention to it. I've now had a read through and, as a result, have a fuller appreciation of the benefits of the deal with Greystar and of the merits of TEF itself.

[easyfella] 05/6/2017 20:50

some interesting posts on LSE TEF board

[hillofwad] 05/6/2017 20:47

James

It looks from the £101m site price that TEF have managed to negotiate an excellent deal for thier partners I would guess that translates into an end value of less than 60% of current sale values in the area .Maybe worth £30m +for TEF

TEF will shortly go into bat on planning so the last thing they can do is toss around around values and profits which will only serve to encourage the local authority to gain further affordable elements and extra S106 contributions

I think this deal sits right up there with the best of them
They have just linked up with a global leader with the prospect of rolling out more It couldn't be better

[james188] 05/6/2017 20:37

There is no shortage of things to talk about at the AGM/ company presentations over the next couple of months. None of us know the detail of the level of risk that TEF has assumed under this deal, but in principle it is a step change in size for the company and will have been very heavily negotiated, assuming that this is the JV that TEF referred to several months ago. The company is acting here as fee developer, but has made it clear that it will continue as principal on other schemes (smaller) in its traditional non-prime areas of London. It is scaling up and this seems to me to be a sensible and measured
way to do it. The list of partners that TEF has assembled and where repeat business is a declared mutual aim is very impressive.

[pillion] 05/6/2017 15:24

It wouldn't surprise me if Telford decide to leave AIM and join the full market
Only valued at £307 million We need to grow imho

CRST my other building company are capitalised at £1.5 billion

[hillofwad] 05/6/2017 13:27

Jurgen I did exactly the same thing!

[jurgenklopp] 05/6/2017 13:09

hillofwad

I have listened to the podcast and am reassured.

I am comfortable holding TEF as the only housebuilder in my ISA.

Indeed, in the not too distant past on this board, I confirmed that I had sold all my Redrow to effectively double up on TEF and it is now my single largest holding by value.

No worries at all here now IMO.

:o)

[hillofwad] 05/6/2017 12:26

Jurgen klopp

Jon has indicated on podcast that the return they will be getting is similar to those of PRS
ie 11-13% with a scheme likely to have an end value of £500m
Likely to be highly profitable for Greystar just do the figures Total entry say £135m Build cost £170m plus fees There is plenty of wonga for Greystar to be generous to TEF

You can reassure the consummate dealmakers at TEF would have built in an attractive fee for the acquisition too It looks as if they have trimmed it right down to £101m

Why you think the time served professionals at TEF are at risk just because its a fixed price as if somehow they wont have put in a huge contingency is beyond me As if suddenly they dont know what they are doing?

Contractors normally work in 3% TEF are working here on 10-13% where is the risk?
Not only that they are now fully aligned with a global leader Seriously what more do you want?

[paleje] 05/6/2017 12:22

IC editorial also has a Buy tip, separate from Thompson:-

Telford Homes (TEF) has secured a pre-construction agreement with US real estate group Greystar for the construction of 894 build-to-rent homes at Nine Elms in Battersea. Greystar has exchanged contracts to buy two plots of land from Royal Mail which are within walking distance of the Northern Line extension and the new US embassy. The deal will provide Telford with regular income during construction and will significantly increase the build-to-rent portfolio that currently stands at around 500 units. Buy

[jurgenklopp] 05/6/2017 12:21

Simon Thom.....

Never mind

:o)

[paleje] 05/6/2017 12:11

Simon Thompson has a column on TEF today, says on forward PE under 9 with good visibility and decent divi there's room to close the valuation gap with larger peers, run profits.

[stentorian] 05/6/2017 12:06

ST at IC recommending to run profits

[speedsgh] 05/6/2017 11:54

Short interview with CEO Jon Di-Stefano re significant build to rent development in partnership with Greystar...

[cerrito] 05/6/2017 11:19

What went trough my mind reading this first thing this morning is their depth of management structure..a topic for the AGM

[shanklin] 05/6/2017 11:12

TEF have stated they will enter into a fixed price contract not that they have done so already.

Obviously, all investors and potential investors have to take a view on...

"Telford Homes is not taking any sales or rental risk but the margin earned will account for full construction risk and therefore is in line with the Group's target margin for build to rent developments."

[shaker44] 05/6/2017 10:58

I guess the risk issue is that they have entered into a fixed price contract into an uncertain future where costs may exceed expectations

[joe say] 05/6/2017 10:40

I'd agree with the Dr - ultimately the apartments need to be of a decent standard - so as long as that is maintained then what's the issue?

[dr_smith] 05/6/2017 10:29

Caradog: They say they are doing it to expand without cost of capital outlay, but law of diminishing returns has to apply and I think it is impossible to second guess extra returns without a spreadsheet detailing margins and variables - and as you point out, who carries risks.
Having said that, if you build 100 units for sale to public and have one contract to build 100 units for third party/partner - aren't the risks the same, needing to build to defined quality timely to commute back to cash.
My view/idle thought. :-)

[jurgenklopp] 05/6/2017 10:25

Caradog

I would tend to agree with you.

When I read the RNS this morning my initial reaction was that they are now dealing with some very big hitters in an area that does not quite match the places where they have been doing so well over the last few years.

Although I am happy to continue to hold the Company is losing a bit of control and increasing risk as you suggested.

[caradog] 05/6/2017 09:46

The nature of the company seems to be changing from preselling units in small and medium sized projects of its own, to building larger numbers of units at a fixed price for third parties. I would have thought that this increases risk. Getting it right is probably very profitable, but getting one contract wrong could have serious consequences. Views?

[joe say] 05/6/2017 09:34

In one sense pleased but as a Chelsea fan I wish the area (i.e. the power station) had been assigned to us !!!

[hillofwad] 05/6/2017 09:17

Although Nine Elms is under pressure with a huge supplyside the price of £101m is cheap this has been under wraps for sometime and no doubt the price has been negotiated south The arrival of the Us Embassy close by and Greystar can be no coincidence Fantastic deal topped up again for the long term